Sakaka, April 08, 2021 -- Under the patronage of HRH Prince Mohammed bin Salman bin Abdulaziz, Crown Prince, Deputy Prime Minister, Chairman of the Supreme Committee for Energy Mix Affairs for Electricity Production and Enabling Renewable Energy Sector, HRH Prince Abdulaziz bin Salman, Minister of Energy, inaugurated the Sakaka IPP PV project, the first renewables project in the Kingdom, with an output capacity of 300 MW, in the presence of HRH Prince Faisal bin Nawwaf bin Abdulaziz, Governor of Al-Jowf Province.
During the ceremony, power purchase agreements (PPA’s) for seven other renewable energy projects in a number of regions were also signed with five investment consortiums composed of twelve Saudi and international companies.
In a statement on this occasion, HRH Prince Abdulaziz bin Salman bin Abdulaziz, Minister of Energy, noted the support of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud, and his wise guidance in all areas, which is always beneficial to the nation and its people. He also expressed appreciation of the support of HRH the Crown Prince saying, “I have to note the great leadership role that HRH Crown Prince Mohammed bin Salman Al Saud is undertaking in enabling the energy sector, through his chairmanship of both the Supreme Committee for Hydrocarbon Affairs and the Supreme Committee for Energy Mix Affairs for Electricity Production and Enabling Renewable Energy Sector, and his guidance which has raised our aspirations. These projects are a practical on-the-ground application of Saudi Vision 2030, that contributes to the optimization of the energy mix and the transformation of the Kingdom from the use of liquid fuel to gas and renewables, which makes these projects significant landmarks in the journey of the energy sector.”
HRH pointed out that the new projects are located in Al Madinah, Sudair, Qurayyat, Shuaibah, Jeddah, Rabigh, and Rafha. The total capacity of these projects, in addition to the two projects of Sakaka and Doumat Al jandal, is 3,670 MW. They will also power more than 600,000 households and reduce greenhouse gas emissions by more than 7 million tons.
Some of these projects, HRH added, have set new world records for the lowest cost of solar-produced electricity. The Shuaibah project’s cost of electricity is 1.04 U.S. cents per kWh.
The private sector, HRH noted, contributes to and has played an essential role in the renewable energy projects. The Sakaka project has been developed by Acwa Power, which is a company co-owned by PIF and is the national leader in this area that has projects across many countries in the world. Acwa Power has also made some achievements with regards to job nationalization; 97% of Sakaka IPP PV’s operation team are Saudis, and 90% of whom are from Al-Jowf.
The significance of the renewable energy projects celebrated today, HRH stated, lie in the fact that they represent practical steps towards achieving a number of strategic goals of Saudi Vision 2030 for the energy ecosystem in general, and the electricity sector in particular. The utilization of renewable energy sources, HRH continued, constitute an important part of the efforts to reduce the use of liquid fuel in electricity production and to optimize the national energy mix. The aim is to have the share of each gas and renewables in that mix at around 50% by 2030, by removing around a million BOEs of liquid gas per day used as fuel in electricity production, water salination, and other sectors.
All of this, HRH said, will enable the Kingdom to increase the energy efficiency in electricity production and assert and enhance the level of our environmental commitment through reducing GHG emissions.
HRH explained that these projects and many others that are under construction across the Kingdom, such as green and blue hydrogen and ammonia projects, and the Kingdom’s adoption of the circular carbon economy, an initiative by the Kingdom that has been endorsed by the G20 as an effective approach to achieve the climate change goal and find more sustainable, and less costly energy systems, together form supportive and supplementary elements for the ambitious goals that the “Saudi Green” and “Middle East Green ” initiatives, which were announced by HRH the Crown Prince a few days ago, seek to achieve. This shows to the world, HRH Minister of Energy said, the Kingdom’s determination to continue to fulfill its obligations under the conventions of environmental protection and climate change.
Completing these projects and connecting them to the national grid, HRH stated, contributes to enhancing the Kingdom’s capacity to produce enough electricity to meet the national needs, promote the reliability of its electricity grid, and supports its ambitious plans to become one of the key countries in producing and exporting renewables-generated electricity. It also promotes, HRH added, electricity trade exchange through the Kingdom’s projects of electricity interconnection with neighboring countries, which have already begun with the Gulf countries and work is in under way to connect with Egypt, Jordan and Iraq, and supports its efforts to nationalize the manufacturing and development of the components of solar and wind energy production and its technologies and enable those working the sector.
During his trip to Al-Jowf, HRH Minister of Energy also visited the Doumat Al Jandal wind energy project, which will have an output capacity of around 400 MW, and checked on its progress.
The solar PV projects announced today include: The Sudair project (1,500 MW), one of the projects co-developed by PIF and its strategic partner Acwa Power and implemented by an Acwa Power-led consortium; Qurayyat IPP PV (200 MW) and Shuaibah IPP PV (600 MW), implemented by a consortium composed of Acwa Power, Gulf Investment, and Al Babtain Contracting; Jeddah IPP PV (300 MW), implemented by a consortium of Masdar, EDF, and Nesma; Rabigh IPP PV (300 MW), implemented by a consortium of Marubeni and Aljumaih, and Rafha IPP PV (20 MW) and Al Madinah IPP PV (50 MW), implemented by a consortium of Al Blagha, Alfanar, and Desert Technologies.
Therefore, the total capacity of these projects, in addition to the two projects of Al-Jowf, Sakaka IPP PV, which was launched today, and the Doumat Al Jandal wind energy project, amounts to 3,670 MW.
The new projects are characterized as independent power producers (IPP). The power produced by these projects will be bought within the framework of 20- to 25-year-long PPA’s with the Saudi Power Procurement Company.
It’s noteworthy that the renewable energy projects the Ministry is working on involve supporting the building of this promising sector through mobilizing private sector investments and encouraging partnerships between the public and private sectors. This would create a national competitive market for renewables, which would enhance the chances of the inception of a new industry for renewables technology.
The locations of the renewable energy projects are carefully chosen by a specialized Saudi technical team, ensuring the highest electricity production quality. These projects play an important role in formulating the circular carbon economy, which is adopted by the Kingdom and was endorsed by it during its presidency of the G20 summit last year, to reduce carbon emissions in the Saudi energy sector.
